the changing energy market · •u.s. reversing 40 years of oil production declines • oil prices...
TRANSCRIPT
THE CHANGING ENERGY MARKET DUE TO THE GROWTH OF PRODUCTION FROM SHALE PLAYS IN THE US AND POTENTIAL OUTSIDE US
Mark Peters Publisher Oil & Gas Financial Journal [email protected] www.ogfj.com
• Tight Oil and Gas • Climate Change • Energy Nationalism • Growth in World Population • EuroZone
• China and India • Energy Security • Overcapacity • Game Changer: Shale • The “Golden Age” of Gas
FACTORS SHAPING ENERGY EXPANSION FOR THE NEXT DECADE:
QUICK LOOK AT OIL PRICES
CRUDE PRODUCTION BUCKING 40 YEAR TREND
• U.S. Reversing 40 Years of oil production declines • Oil Prices appear to be range-bound • U.S. natural gas poised for long-term recovery • Recent prediction that U.S. will surpass Saudi
Arabia as largest oil producer by IEA • U.S. already surpassed Russia as largest gas
producer • Potential for U.S. to become energy independent • Implications go way beyond energy
CHANGES IN US OIL & GAS
US DEPENDENCE ON IMPORTED LIQUIDS DECLINES
US PRODUCTION OF CRUDE INCREASES DUE TO TIGHT FORMATIONS (SHALE)
NATURAL GAS PRODUCTION GROWS AND US BECOMES NET EXPORTER
SHALE GAS LEADS PRODUCTION INCREASE
SHALE OIL AND GAS IS GLOBAL
CO2 EMISSIONS DECLINE
Source: Cagle Cartoons, Week of June 17-23, 2012
INDUSTRY TAX RATES
Source: CEE, M.M. Foss, 9/25/2012
• Economic Nationalism • Growth in Population • Consumption
CHINA & INDIA
ENERGY SECURITY
Source: T. Boone Pickens, March 2012
OVERCAPACITY
“CNG IN A BOX” TM
Source: GE, AP file photo/Douglas C. Pizac
RE-FUELING LOCATIONS IN THE U.S.
THE SEVEN BIG SHALES
Source: Oil & Gas Financial Journal, Warlick International Article, August 2012
SHALE PLAYS ARE MORE PRODUCTIVE
A NATURAL GAS SUPER SPIKE 2016?
15.0
16.0
17.0
18.0
19.0
20.0
21.0
22.0
23.0
24.0
25.0
Average Annual Industrial Demand
Source: Energy Information Administration May 2012 & RJ Estimates
*Includes LNG export plants operational
• More refining capacity added to handle increased oil production and potential for export
• Additional pipelines and gas processing facilities will be needed to handle changes in the flow of raw material and finished products
• Potential GTL and LNG export from U.S. • Petrochemical facilities upgraded and expanded and
potential for new plants in U.S. Northeast • US economy will benefit from lowered trade deficit and
increase in manufacturing base • US $ Goes Higher • All the above will require more valves
INFRASTRUCTURE CHANGES:
THE CHANGING ENERGY MARKET DUE TO THE GROWTH OF PRODUCTION FROM SHALE PLAYS IN THE US AND POTENTIAL OUTSIDE US
Mark Peters Publisher Oil & Gas Financial Journal [email protected] www.ogfj.com